Drivers who carried certain auto insurance coverage with AAA may be eligible for money from a $4.15 million class action settlement.
The case involves allegations that AAA improperly reduced underinsured motorist claims by subtracting amounts paid by the at-fault driver’s insurance company. Some policyholders may now be able to recover up to $25,000, while others may receive a partial refund of premiums.
If you had an AAA auto policy with UM/UIM coverage in New Mexico between 2010 and 2022, it’s worth taking a closer look.
Why This Lawsuit Exists?
The lawsuit alleged that Interinsurance Exchange of the Automobile Club (AAA) reduced payments for underinsured motorist (UIM) claims by the amount already paid by the at-fault driver’s insurer.
Plaintiffs claim this practice violated New Mexico law governing uninsured and underinsured motorist coverage.
AAA denies any wrongdoing, but agreed to a $4.15 million settlement to resolve the claims and avoid the cost and uncertainty of continued litigation.
The settlement may provide compensation to drivers whose claims were affected, as well as partial refunds for certain policyholders.
Who Qualifies?
You may be part of the settlement class if you fall into one of two groups.
1. Drivers with Offset Claims
You may qualify if:
You had an underinsured motorist claim with AAA
The claim was reduced or “offset” by the amount paid by the at-fault driver’s insurance
The accident occurred between Jan. 1, 2010, and May 4, 2022
2. Policyholders with UM/UIM Coverage
You may also qualify if:
You purchased a New Mexico automobile insurance policy from AAA
The policy included uninsured/underinsured motorist (UM/UIM) coverage
The policy was active between Jan. 1, 2010, and May 4, 2022
Different benefits apply depending on which group you fall into.
How Much Can You Get?
The settlement creates a $4,150,000 fund to resolve the claims. Eligible class members may receive:
Offset Claim Payments: Drivers whose underinsured motorist claims were reduced may receive up to $25,000. Actual payments may be reduced on a pro rata basis depending on the number of valid claims submitted.
Premium Refunds: Policyholders who purchased UM/UIM coverage during the class period may receive a partial refund of premiums paid.
Refund amounts will vary depending on factors including:
Premiums paid for UM/UIM coverage
Settlement administration costs
The amount allocated to offset claim payments
Your Options
| Option | What It Means | Deadline |
|---|---|---|
| Submit a Claim Form | Required to request payment for an offset UIM claim. | April 29, 2026 |
| Do Nothing | If you only purchased UM/UIM coverage and do not file a claim, you may automatically receive a premium refund check. | — |
| Exclude Yourself | Opt out of the settlement and keep the right to pursue your own lawsuit. | March 30, 2026 |
| Object to the Settlement | Tell the court why you disagree with the settlement terms. | March 30, 2026 |
| Final Approval Hearing | The court will determine whether to approve the settlement. | On or after May 13, 2026 |
How to File a Claim?
To receive a payment related to an offset underinsured motorist claim, you must submit a claim form by April 29, 2026.
You can file:
Online through the settlement website, or
By mailing a completed claim form
If submitting by mail, send your form to:
Smith v. Interinsurance Exchange of the Automobile Club
Settlement Administrator
P.O. Box 5339
Portland, OR 97208-5339
To file a claim, you may need information such as:
Your AAA policy number, and/or
Your claim number related to the accident
Payments will be issued only if the court grants final approval and after any appeals are resolved.
